The Department of Labor's Wage Mandate for Farmworkers and H-2A Visas

Farmers and ranchers who hire foreign-born seasonal workers on H-2A visas will face prevailing wages in 2023 that are about 9.36% higher, on average, than the prevailing wages for H-2A workers in 2022. One of the requirements of the H-2A visa program is that workers must be paid at least the prevailing wage determined by the US Department of Labor (DOL) which is called the Adverse Effect Wage Rate (AEWR). AEWRs vary by region and have increased rapidly in the past year in some states that rely heavily on the H-2A program. In Florida, the AEWR increased by almost 15.5% and in Alabama, Georgia, and South Carolina the AEWR increased by just over 14%. Because these four states account for about one-third of all H-2A workers, the new wage mandates determined by the DOL will have a substantial negative impact on U.S. agriculture. Farmers and growers in the southeastern US face the biggest mandated wage increases and this increase in labor costs will almost certainly lead to higher prices for the products grown in the southeastern US.

The AEWR, or prevailing wage for H-2A workers established by the DOL, is based on the results of a survey conducted by the U.S. Department of Agriculture (USDA). Last week the USDA released Farm Labor, its semi-annual report of the wage and employment survey of farm and ranch workers. The November report includes the wages of field and livestock workers averaged across four reference weeks throughout the year (in January, April, July, and October) which is what the DOL uses to determine the AEWR. Both the AEWR and the annual average wage of field and livestock workers are reported for 18 different regions and for the U.S. overall.[1]

The following table shows the AEWR in 2022 and 2023 in each state, as well as the percentage increase in the AEWR in each state over the past year as well as over the past five years. In every state, H-2A workers must be paid at least $13.67 per hour and in 43 states the mandated wage for H-2A workers is at least $14.26.[2] The states with the highest AEWRs are California ($18.65), Oregon ($17.97), and Washington ($17.97).

As noted above, Florida, Alabama, Georgia, and South Carolina have seen the largest increases in the AEWR over the past year. California, Nevada, and Utah have seen the largest increases over the past five years. The final row shows the weighted average of the percentage increase in AEWRs across all states, where states that employ relatively more H-2A workers receive a higher weight.[3] Because of the substantial increase in AEWRs in the past year in a few states that rely heavily on the H-2A program the weighted average increase in the AEWR across the US is 9.36% in just the past year and 30.85% in the past five years.

[1] Farms and ranches that rely on foreign-born seasonal workers in the H-2A visa program must pay H-2A workers at least the AEWR in its region unless the state minimum wage is higher, or a state workforce agency determines through its own survey that wages in the state are even higher than the AEWR.

[2] There is no AEWR for the state of Alaska.

[3] The weights are determined by the number of workers receiving H-2A prevailing wage certifications in each state during the 2021 Federal fiscal year, as reported by the DOL.